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Millions of Americans need drugs like Ozempic. Will it bankrupt the healthcare system?

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Millions of Americans need drugs like Ozempic. Will it bankrupt the healthcare system?

An April 24 letter from Vermont Sen. Bernie Sanders to the CEO of Novo Nordisk began with heartfelt thanks to the Danish drugmaker for inventing Ozempic and Wegovy, two medications poised to improve the health of tens of millions of Americans with obesity and related diseases.

But the senator’s grateful tone faded rapidly.

“As important as these drugs are, they will not do any good for the millions of patients who cannot afford them,” Sanders wrote. “Further, if the prices for these products are not substantially reduced they also have the potential to bankrupt Medicare, Medicaid, and our entire health care system.”

It’s a sentiment that comes up regularly among people who are huge fans of the medications and their close relatives, Eli Lilly’s Mounjaro and Zepbound. All of them work by masquerading as a natural hormone called GLP-1 and tricking the body into slowing digestion and reducing blood sugar.

The medications help patients lose double-digit percentages of their body weight and keep it off — an average of 12.4% in the clinical trial for Wegovy, and an average of 18% at the highest dose in the trial for Zepound. It’s rare for insurance companies to cover GLP-1 drugs for weight loss alone, and Medicare is forbidden by law from doing so. But as the pounds fall, so do the risks of serious problems like type 2 diabetes, hypertension, heart attacks and strokes, and the medications can be covered to prevent these conditions.

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“Obesity is a huge public health crisis, and for so long we had no treatments that really made a difference,” said Dr. Lauren Eberly, a cardiologist and health services researcher at the University of Pennsylvania. “These medicines could change the trajectory of your disease and save your life.”

That makes these drugs extremely valuable. Unfortunately, they’re also extremely expensive.

The sticker price for Ozempic, which the Food and Drug Administration approved to treat type 2 diabetes, is more than $12,600 per year. Wegovy, a higher-dose version approved for weight loss in people with obesity and as a way for overweight patients with cardiovascular disease to reduce their risk of heart attack and stroke, retails for nearly $17,600 a year.

Mounjaro and Zepbound mimic GLP-1 as well as a related hormone called glucose-dependent insulinotropic peptide, or GIP. Their list prices add up to roughly $13,900 per year for Mounjaro, which is approved as a diabetes treatment, and about $13,800 per year for Zepbound, the weight-loss version.

Eberly said those prices are simply too high.

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“We as a public health medical community — and the community at large — really need to advocate for increased affordability,” she said. “I think we’re overdue for a real reckoning on this.”

In the United States, the tab for these GLP-1 drugs is exorbitant almost any way you look at it.

In 2022, the prescription drug that accounted for the biggest share of Medicare Part D spending was the blood thinner Eliquis. More than 3.5 million beneficiaries used it that year, at a cost of $15.2 billion, the U.S. Department of Health and Human Services says.

That total was more than double the amount spent on the next-costliest drug, the type 2 diabetes medication Trulicity, according to the Centers for Medicare and Medicaid Services, or CMS.

But $15.2 billion is practically a rounding error compared to the $268-billion price tag if Wegovy were to be provided to all 19.7 million Medicare beneficiaries with obesity, researchers estimated in the New England Journal of Medicine.

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Even if the drug were prescribed only to Medicare patients with a clinical diagnosis of obesity, the cost would exceed $135 billion. That’s more than the $130 billion Medicare spent on all retail prescription drugs in 2022, according to CMS.

“This is a real budgetary situation for CMS,” said Melissa Barber, a public health economist who studies pharmaceutical policy at Yale School of Medicine. “They’re going to have to deal with this.”

No matter how expensive a drug, it’s “extremely unlikely” that Medicare would actually go bankrupt, a CMS spokesperson said. Spending for the Medicare Part B and Part D programs is reset every year, and if it goes up, beneficiaries and the government share the burden of covering the difference, the spokesperson said.

Sanders offered another perspective. A report released this month by the Senate Health, Education, Labor, and Pensions Committee, which he chairs, noted that Americans get charged $1,349 for a 28-day supply of Wegovy, while the same amount of the medication goes for $186 in Denmark, $137 in Germany and $92 in the United Kingdom.

“The prices for these drugs are so high in the United States that everyone — regardless of whether they use the products or not — will likely be forced to bear the burden of Novo Nordisk’s profit maximizing strategy through higher insurance premiums and taxes,” Sanders wrote in his letter to the company.

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The financial impact on Medicare is tempered by a 2003 federal law that prevents the government health insurance program from covering weight-loss medications.The drugs can be added to formularies if prescribed for another “medically accepted indication,” such as to treat type 2 diabetes or reduce heart risk, but patients can’t get it if their only medical issue is obesity.

Rep. Brad Wenstrup (R-Ohio) has introduced a bill that would reverse that 2003 ban. Though the Treat and Reduce Obesity Act has 97 co-sponsors from both sides of the aisle, its financial implications have made it difficult to muster the votes needed for the legislation to advance, he said.

Indeed, Phillip Swagel, director of the Congressional Budget Office, said last month that if the goal was to provide weight-loss drugs without increasing the deficit, their net cost would need to fall by a factor of 10 just to “get in the ballpark.”

Dr. Caroline Apovian, co-director of the Center for Weight Management and Wellness at Brigham and Women’s Hospital in Boston, is concerned that the budget-busting potential of Wegovy and Zepbound has made private health insurers too scared to cover them.

“No insurance company is going to be able to afford to give these lifesaving drugs to the 42% of Americans with obesity,” she said. “So we have to do something.”

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Exactly what that something should be is not clear.

One possibility is for the federal government to ask Novo Nordisk and Eli Lilly to discount their GLP-1 drugs. The Inflation Reduction Act empowers Medicare to negotiate lower prices for 10 medicines each year, and researchers in the Congressional Budget Office expect at least some GLP-1s to make the list “within the next few years.”

Private insurers are free to seek deals of their own, and the similarities between the Novo Nordisk and Eli Lilly drugs give insurers quite a lot of bargaining power, said John Cawley, a health economist at Cornell.

“They should be more effective at playing them off each other,” Cawley said. “They can say, ‘We’re only going to cover one of these. Which do you want to be, the one we cover or the one we don’t?’”

There’s reason to think the drugmakers could afford to offer significant discounts if they were so inclined.

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Novo Nordisk charges Americans $968.52 for a 28-day supply of Ozempic, regardless of whether the dose of the active ingredient semaglutide is 0.5, 1 or 2 milligrams per injectable pen. Likewise, Wegovy is priced at $1,349.02 every 28 days, no matter whether the weekly injections contain 0.25, 0.5, 1, 1.7 or 2.4 mg of semaglutide.

Yet a 2022 report in the journal Obesity estimated that a 2.4-mg weekly dose of semaglutide could be made for “about $40” a month.

Barber is part of a team that also examined what it would cost to produce various diabetes drugs using methods designed to keep prices low. Her group calculated that a 30-day supply of an injectable medicine with 0.77 milligrams of semaglutide could be manufactured for as little as 89 cents, a total that includes a 10% profit. Even with higher costs and a 50% profit, the drug could be made for $4.73 a month, the team reported in March in JAMA Network Open.

“They could be very affordable,” Barber said.

A spokeswoman for Novo Nordisk said the company was “unaware of the analysis” used in the study, but it recognizes the need to find ways to make its products more affordable. She also said the company is reviewing the report from Sanders’ Senate committee and noted that “75% of our gross US sales goes to rebates and discounts reimbursed to insurance companies and other payers.”

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Representatives from Eli Lilly did not comment on the cost of its drugs.

If manufacturers don’t agree to reduce prices voluntarily, the federal government could take more forceful steps. The Inflation Reduction Act put a $35-a-month limit on what seniors with Medicare Part D plans need to pay for insulin. Congress could set a limit on GLP-1 drug prices too, though that would be “a last resort,” said Lawrence Gostin, an authority on public health law at Georgetown University.

Rationing the drugs is another way to keep spending in check, health economists say. High sticker prices have limited access to the drugs, often making income a determining factor in deciding who can take them and who must go without. But there are other ways to prioritize patients.

A person with a “healthy weight” — defined as a body mass index between 18.5 and 24.9 — incurs about $2,780 a year in healthcare costs, on average. That figure rises by $2,781 for a person with a BMI of 30 or above , according to the 2024 edition of “The Handbook of Obesity.”

Most of those added costs are concentrated among people at the higher end of the BMI curve. Someone with a BMI between 35 and 39.9 requires $3,336 in additional health spending per year, on average, while a person with a BMI of 40 or above needs an extra $6,493 in medical care.

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“If your goal is to target interventions in order to reduce healthcare spending, you’d want to target it to people with more extreme or morbid obesity,” said Cawley, who co-wrote the handbook’s chapter on obesity’s economic toll.

Even if all else fails, prices are bound to fall over a period of years as new drugs win FDA approval and make the market more competitive, economists said. And once generic versions become available, prices will plummet. That’s what happened with pricey medications for hepatitis C and HIV.

“Eventually things become generic,” Wenstrup said. “They still do the same thing but it costs less.”

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At Chile’s Vera Rubin Observatory, Earth’s Largest Camera Surveys the Sky

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At Chile’s Vera Rubin Observatory, Earth’s Largest Camera Surveys the Sky

At the heart of the new Vera C. Rubin Observatory in Chile is the world’s largest digital camera. About the size of a small car, it will create an unparalleled map of the night sky.

The observatory’s first public images of the sky are expected to be released on June 23. Here’s how its camera works.

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When Times reporters visited the observatory on top of an 8,800-foot-high mountain in May, the telescope was undergoing calibration to measure minute differences in the sensitivity of the camera’s pixels. The camera is expected to have a life of more than 10 years.

A single Rubin image contains roughly as much data as all the words that The New York Times has published since 1851. The observatory will produce about 20 terabytes of data every night, which will be transferred and processed at facilities in California, France and Britain.

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Note: Data flow map is schematic, based on Rubin Observatory diagrams.

Specialized software will compare each new image with a template assembled from previous data, revealing changes in brightness or position in the sky. The observatory is expected to detect up to 10 million changes every night.

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Some changes will be artificial. Simulations suggest that roughly one in 10 Rubin images will contain at least one bright streak or glint from the thousands of SpaceX Starlink and other satellites orbiting Earth.

Despite streaks, clouds, maintenance and other interruptions over the next decade, the Rubin Observatory is expected to catalog 20 billion galaxies and 17 billion stars across the Southern sky.

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'We are still here, yet invisible.' Study finds that U.S. government has overestimated Native American life expectancy

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'We are still here, yet invisible.' Study finds that U.S. government has overestimated Native American life expectancy

Official U.S. records dramatically underestimate mortality and life expectancy disparities for Native Americans, according to a new, groundbreaking study published in the Journal of the American Medical Association. The research, led by the Boston University School of Public Health, provides compelling evidence of a profound discrepancy between actual and officially reported statistics on the health outcomes of American Indian and Alaska Native (AI/AN) populations in the U.S.

The study, novel in its approach, tracks mortality outcomes over time among self-identified AI/AN individuals in a nationally representative cohort known as the Mortality Disparities in American Communities. The researchers linked data from the U.S. Census Bureau’s 2008 American Community Survey with official death certificates from the Centers for Disease Control and Prevention’s National Vital Statistics System from 2008 through 2019, and found that the life expectancy of AI/AN populations was 6.5 years lower than the national average. They then compared this to data from the CDC’s WONDER database, and found that their numbers were nearly three times greater than the gap reported by the CDC.

Indeed, the study found that the life expectancy for AI/AN individuals was just 72.7 years, comparable to that of developing countries.

The researchers also uncovered widespread racial misclassification. The study reports that some 41% of AI/AN deaths were incorrectly classified in the CDC WONDER database, predominantly misrecorded as “White.” These systemic misclassifications drastically skewed official statistics, presenting AI/AN mortality rates as only 5% higher than the national average. When they adjusted the data to account for those misclassifications, the researchers found that the actual rate was 42% higher than initially reported.

The issue of racial misclassification “is not new for us at all,” said Nanette Star, director of policy and planning at the California Consortium for Urban Indian Health. The recent tendency for journalists and politicians to use umbrella terms like “Indigenous” rather than the more precise “American Indian and Alaska Native” can obscure the unique needs, histories and political identities of AI/AN communities, Star noted, and contribute to their erasure in both data and public discourse. “That is the word we use — erasure — and it really does result in that invisibility in our health statistics,” she said.

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Issues related to racial misclassification in public records persist across the entire life course for AI/AN individuals, from birth to early childhood interventions to chronic disease and death. Star noted that in California, especially in urban regions like Los Angeles, Native individuals are frequently misidentified as Latino or multiracial, which profoundly distorts public health data and masks the extent of health disparities. “It really does mask the true scale of premature mortality and health disparities among our communities,” Star said.

Further, said Star, the lack of accurate data exacerbates health disparities. “It really is a public health and justice issue,” she said. “If you don’t have those numbers to support the targeted response, you don’t get the funding for these interventions or even preventative measures.”

According to U.S. Census data, California is home to the largest AI/AN population in the United States. That means it has a unique opportunity to lead the nation in addressing these systemic issues. With numerous federally and state-recognized tribes, as well as substantial urban AI/AN populations, California can prioritize collaborative and accurate public health data collection and reporting.

Star noted that current distortions are not always malicious but often stem from a lack of training. She suggested that California implement targeted training programs for those charged with recording this data, including funeral directors, coroners, medical doctors and law enforcement agents; allocate dedicated resources to improve the accuracy of racial classification on vital records; and strengthen partnerships with tribal leaders.

The study authors suggest similar approaches, and there are numerous examples of successful cases of Indigenous-led health partnerships seen across Canada and the U.S. that have helped reduce health disparities among AI/AN communities that could be used as a template.

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These efforts would not only help to move toward rectifying historical inaccuracies, but also ensure that AI/AN communities receive equitable health resources and policy attention.

“When AI/AN people are misclassified in life and in death, it distorts public health data and drives inequities even deeper,” said Star. “Accurate data isn’t just about numbers — it’s about honoring lives, holding systems accountable and making sure our communities are seen and served.”

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Supreme Court upholds red-state laws that ban hormones for transgender teens

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Supreme Court upholds red-state laws that ban hormones for transgender teens

The Supreme Court ruled Wednesday that states may ban hormone treatments for transgender teens, rejecting the claim that such gender-based discrimination is unconstitutional.

In a 6-3 decision, the justices said states are generally free to decide on proper standards of medical care, particularly when health experts are divided.

Chief Justice John G. Roberts, writing for the court, said the state decides on medical regulations. “We leave questions regarding its policy to the people, their elected representatives, and the democratic process,” he said.

In dissent, Justice Sonia Sotomayor said the law “plainly discriminates on the basis of sex… By retreating from meaningful judicial review exactly where it matters most, the Court abandons transgender children and their families to political whims. In sadness, I dissent.” Justices Elena Kagan and Ketanji Brown Jackson agreed.

The ruling upholds laws in Tennessee and 23 other Republican-led states, all of them adopted in the past four years.

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Tennessee lawmakers said the number of minors being diagnosed with gender dysphoria had “exploded” in recent years, leading to a “surge in unproven and risky medical interventions for these underage patients.”

California and other Democratic-led states do not prohibit doctors from prescribing puberty blockers or hormones for those under age 18 who are diagnosed with gender dysphoria.

While the court’s ruling in the Tennessee case should not directly affect California’s law, the Trump administration seeks to prevent the use of federal funds to pay for gender affirming care.

This could affect patients who rely on Medicaid and also restrict hospitals and other medical clinics from providing hormones and other medical treatments for minors.

Wednesday’s decision highlights the sharp turn in the past year on trans rights and “gender affirming” care.

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Solicitor Gen. Elizabeth Prelogar, representing the Biden administration, had appealed to the Supreme Court in November 2023, and urged the justices to strike down the red-state laws.

She spoke of a broad consensus in favor of gender affirming care. It was unconstitutional, she argued, for states to ban “evidence-based treatments supported by the overwhelming consensus of the medical community.”

But Republican lawmakers voiced doubt about the long-term effect of these hormone treatments for adolescents.

Their skepticism was reinforced by the Cass Report from Britain, which concluded there were not long-term studies or reliable evidence in support of the treatments.

Trans-rights advocates argued the court should have deferred to parents and their doctors, not state lawmakers.

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“The court today failed to do its job,” said Jennifer Levi, GLAD Law senior director of transgender and queer rights. “When the political system breaks down and legislatures bow to popular hostility, the judiciary must be the Constitution’s backbone. Instead, it chose to look away, abandoning both vulnerable children and the parents who love them.”

Lawyers for Lambda Legal and the ACLU called it “a heartbreaking ruling, making it more difficult for transgender youth to escape the danger and trauma of being denied their ability to live and thrive.”

“This is a sad day, and the implications will reverberate for years and across the country, but it does not shake our resolve to continue fighting,” said Sasha Buchert, a Lambda attorney.

Upon taking office in January, President Trump targeted transgender people without specifically mentioning them.

He said his administration would “recognize two sexes, male and female. These sexes are not changeable and are grounded in fundamental and incontrovertible reality.”

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His administration later said its ban on gender affirming care for minors would extend to medical facilities receiving federal funds.

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